Free practice
RSE practice questions: ethics and conduct
Ten RSE practice questions on ethics. CIRO IDPC Rule 1400 series covers conflict-of-interest disclosure and the materiality threshold. NI 31-103 §13.4 governs outside business activities; §13.5 prohibits personal financial dealing with clients. Most retail ethics fails are about timing of disclosure, not the existence of disclosure.
10 free questions
Click a question to reveal the answer and the explanation. The full bank includes an AI tutor on every wrong answer with the rule citation behind the question.
Want 100 more questions on this topic?
Element 1 of every CIRO course is free — lessons, practice bank, AI tutor. No card to try. $29.99/month or $249/year unlocks the rest. 30-day money-back.
FAQ
What's an outside business activity?
Any activity a registrant performs outside the dealer that could reasonably be expected to give rise to a conflict, hold them out as part of another business, or generate income. NI 31-103 §13.4 requires written disclosure to the dealer + client where applicable.
Can I borrow money from a client?
No. Personal financial dealing under NI 31-103 §13.5 prohibits borrowing, lending, gifts beyond firm policy, and joint investment with clients (with limited exceptions for family members under firm review).
What's the gatekeeper obligation?
Registrants are expected to identify and report suspicious activity (AML, fraud, manipulation) to the dealer and to FINTRAC where reportable. Failure to escalate is a regulatory breach, not just a moral one.
Difference between suitability and fiduciary duty?
Suitability (CIRO Rule 3402) is the regulatory floor: the recommendation must be suitable given KYC. Fiduciary duty (common law) applies in specific relationships such as managed accounts and trustee roles. Confusing these two is a frequent wrong answer.
What's the conflict-of-interest disclosure timing rule?
Material conflicts must be disclosed in writing to clients before the conflict crystallizes (i.e., before the trade or recommendation). Generic boilerplate at account opening is insufficient when a specific conflict applies.